I am an optimist about Keir Starmer. His achievement in masterminding Labour’s recovery from its worst defeat since 1935 has so far been remarkable. His leadership of the party is secure: his potential premiership is still a work in progress. But he is well on the way to what would be an astonishing turnaround in Labour’s electoral fortunes: to take the party in a single Parliament from the edge of the electoral abyss at the end of 2019 into government by 2024. This lecture is about the challenges he still faces in winning a credible and convincing electoral mandate, framing a mood of confidence and optimism about the change his government will bring, and governing within a broken Whitehall and ‘Westminster model’ to ensure his Labour government proves more than a one-term ‘flash in the pan.’
Keir Starmer has been Labour’s Leader for just over three years. When he took over, Labour was twenty-two points behind the Conservatives in the polls. In recent months Labour’s poll lead over the Conservatives has steadied at around fifteen points. This is better for the Conservatives than their nadir when Rishi Sunak took over from Liz Truss’s brief and disastrous premiership, and not as impressive as the extraordinary poll leads Tony Blair registered as opposition leader prior to his 1997 landslide. Labour is doing well but not so well as to make victory certain or an overall Labour majority inevitable. In the late autumn of 2022, some psephologists estimated a Labour landslide, with the party winning over five hundred seats in a 650 member House of Commons. It would be disastrous for Labour to indulge itself now in such fantasies.
The Sunak government is somewhat restoring the Conservatives’ reputation for governing competence after the havoc of Boris Johnson and Liz Truss. I put the emphasis on ‘somewhat’. The ground Sunak must make up is enormous. While he conveys diligence and seriousness, there are two major question marks about his premiership. The Conservative parliamentary party is riven by faction and no longer sure what it believes in and where it stands. Sunak is buffeted in all directions and consequently comes across as weak. Yet his other problem is that, at his core, he strikes one as a right wing, free market, low tax Conservative. Not only is this out of touch, after thirteen years of austerity, with where most British public opinion is today. As a free market globalist, whose instincts are naturally opposed to state intervention, Sunak appears out of sync with the new emerging international consensus, whether in the United States it be Bidenomics, or in Europe, the wide backing for the investment-led Covid recovery and climate transition plans as well as the retreat from a purist view of free trade implied by Ursula van der Leyen’s new emphasis on “de-risking” relations with China.
Also, Sunak accepts the view of his political strategists that he must combine a steady hand on the tiller with a strident, populist social conservatism. This is leading the government into a morass of undeliverable pledges and barefaced questionable assertions, calling into question the very essence of Sunak’s strengths: his claim to decency as well as competence.
Historians may come to see the date of March 22nd, 2023, as a turning point in Conservative history. Boris Johnson’s reputation suffered a huge double blow. He stumbled as a witness before a Parliamentary Privileges Inquiry into whether he lied to the House of Commons over “partygate.” He and his allies were only able to muster 22 Conservative MPs to vote against the Windsor framework that resolved the extreme tensions between the EU and UK over the Northern Ireland Protocol, though there were many more deliberate abstentions. However, the eclipse, at least for the moment, of Boris Johnson does not mean the Conservatives have found a new unity. Everywhere one looks there is division on ideology, policy, and personality. Who knows who will win the great factional and ideological struggle that awaits the party thereafter when and if they lose. Suella Braverman is clearly gearing up for the fight!
The underlying economic position facing the Conservatives is little short of disastrous. The ‘cost of living’ crisis is intensifying for most working families throughout 2023, as living standards fall at their fastest rate since the Second World War. As the OBR noted in March, “real household income per person falls by 6% between 2021-22 and 2023-24 …. the largest two-year fall in real living standards since ONS records started in the 1950s”. The rise of the foodbank, on which many working families have become dependent, is the most telling symbol of the failure of Conservative values to govern the country successfully. Nor it certain whether Sunak will meet his pledge to halve the rate of inflation by the end of this year. As gas prices come down from their peak, food prices and mortgage costs have soared. The inflation outlook is deeply troubling. Yet the government is presently engaged in a desperate attempt to find the fiscal space for a tax cutting pre-election budget.
The Conservatives want to go into the next election claiming the worst is over and that economic growth is returning. It may well be, but at a very modest rate. Since Brexit, Bank of England estimates of the underlying growth potential of the economy have become particularly pessimistic. Yet, for all the limited room for manoeuvre the Conservatives can find in the short term to restore their electoral popularity, the government can do little to mask the reality that most families will have seen little growth in their disposable incomes since the 2008 financial crisis. At the same time, the state of most public services is dire: nothing works as it should. Such is the dismal legacy of thirteen years of Conservative government. Against this background, why, you may ask, should any voter want to grant the Conservatives a fifth term?
The answer of course is one that many Labour people are still reluctant to face up to. Mistrust of Labour runs deep. It goes back to the 2008 banking crisis and the Tory success in blaming it on the Labour government. Then came the Ed Miliband leadership, which gave voters the impression that he was ashamed of what Labour had achieved in its thirteen years of government but offered little clarity as to his alternative. Then came the Jeremy Corbyn ‘experiment.’ Eventually the public got to understand all too well what Labour under his leadership stood for – and millions of former Labour voters refused to back it. Today many voters say they do not know what Keir Starmer stands for. That is a problem Keir must urgently address. But frankly that is an advance on where Labour was under Corbyn and an overhang of his toxic legacy.
The 2017 general election result in which Labour polled 40% of the vote led some to believe that a political project well to the Left of New Labour, could chart a path to socialist transformation. For me, the Corbyn project was always problematic. Its central proposition was to build a British state far more extensive, more powerful, more directing of the British economy than we have today, in the belief that by these means the great injustices which Corbyn and his supporters consistently railed against, could successfully be addressed. What Corbyn offered was a national vision of left-wing populism that I never thought feasible, or for that matter desirable.
Corbyn saw himself as an internationalist but without any clear conception of what that would mean in an ever more interdependent world of rampant global capitalism, astonishing technological advance, rapid climate change and fundamental and dangerous shifts in the international order. Corbyn might have redeemed himself had he vigorously defended Britain’s membership of the European Union in the 2016 referendum. But he didn’t, for the simple reason he never really believed in a united Europe. Corbyn did have a global vision, but it was to view the United States as the source of most global problems. When it came to highlighting global injustice in this world of multiple tragedies, no injustice in his eyes compared to Israel’s treatment of the Palestinians. Of course, there is much to criticise in the actions of recent Israeli governments. Yet unbalanced criticism of Israel itself, and implicit support for terrorism, attracted new far-left members to the party and explains why disgracefully it became home to antisemitism.
In 2017, Labour never came as close to power as Corbyn’s fervent disciples imagined. Corbyn’s clear message on ending austerity did strike a chord, as the underfunding of public services since 2010 began to be evident in cuts to school budgets and lengthening hospital waiting lists. He attracted huge crowds of enthusiasts as the incorruptible prophet returning from the wilderness. Yet in truth, Labour was the principal and somewhat undeserved beneficiary of widespread Remainer grief at the Brexit vote. Also, the Conservatives under Theresa May fought one of the weakest campaigns in Britain’s electoral history.
By the 2019 election, the public mood had shifted decisively. The electorate had grown weary of Parliament’s inability to settle the Brexit argument. In Boris Johnson, the Conservatives had a Leader who pledged “to get Brexit done” promising a mythical land of milk and honey that lay beyond. He also claimed to be anti-austerity and pro-levelling up. His lies were believed with no credible opposition to challenge them. Disillusion with Corbyn had by then well and truly set in. His reaction to the Salisbury poisonings had demonstrated a naïve willingness to take Vladimir Putin at his word. (Under Corbyn’s leadership, what would have been Labour’s position on Putin’s invasion of Ukraine?) Labour’s failure to tackle antisemitism mired the party in scandal and disgrace. The Corbyn leadership was the dominant issue on the hundreds of working-class doorsteps which I personally canvassed. Labour duly crashed and burned. In this context the Starmer leadership was born and explains the demons he has had to slay.
Starmer’s first task has been to clean out the Augean stables of the Corbyn Labour party. In this he took his first big decision, whether consciously or not I do not know. He would not prioritise maintaining the unity of the 2019 party above what needed to be done to give Labour a realistic prospect of power at the next election. Starmer supporters first managed to secure an impressive majority on Labour’s governing body, the National Executive, which they then used to good effect. Antisemitism is being systematically rooted out. Of the hundred plus Labour candidates so far selected by constituency parties for winnable seats, only two are firm Corbyn supporters. Jeremy Corbyn himself has been debarred as a Labour candidate at the next election. The Shadow Cabinet has been completely reconstructed with credible new faces to the fore. In three short years the party and its culture have been transformed.
Starmer deserves great credit for forcing through these internal changes against a difficult background. Boris Johnson in the first eighteen months after his general election landslide was feted as the deliverer of Brexit and then (or so he claimed) of the Covid vaccine. Labour suffered the catastrophic loss of Hartlepool in the May 2021 by-election. Starmer’s leadership would have come under challenge if Labour had lost the Batley and Spenborough by-election a month later: Labour held the seat by a mere three hundred votes. Yet, ignoring again the pressure to prioritise party unity over all else, Starmer courageously pressed ahead with rule changes at the September 2021 conference without any certainty that he would win the conference votes. These rule changes embodied the Equality and Human Rights Commission findings on antisemitism, strengthened the role of the national party in parliamentary selections, bolstered the position of MPs in the election of the party leader, and gave Labour MPs extra protection from the threat of factional deselection in their constituencies. These victories were critical in turning the page on the Corbyn era.
Yet throughout all this turmoil, there was still considerable doubt over what Labour’s strategy for electoral victory was to be. The 2019 election result was a huge shock for Labour. Could it ever win? Would it even survive? Labour’s 32% may sound respectable enough by Continental standards of proportional representation in multi-party systems. In first past the post politics, it spelt disaster. At no election for the last 90 years have fewer Labour MPs been elected to the Commons. Put it another way: to win an overall majority of one, Labour must gain 127 seats at the next election, a feat Labour has only achieved twice in its history: under Clem Attlee in 1945 and Tony Blair in 1997.
Yet what is the coalition of voters Labour should aim to build? 2019 was not only a disastrous defeat but resulted in a revolution in Britain’s electoral demography. Labour piled up huge votes in London, the big English cities and university towns based on its new electoral coalition of the progressive graduate middle class, the younger precariat, students, and most ethnic minority voters. But there are not enough seats with this demographic profile to take Labour anywhere near the winning line.
At first the challenge facing Labour was framed – in my view misleadingly – in terms of winning back the so-called ‘Red Wall’ of old industrial seats in northern and midlands towns that Labour had lost spectacularly for the first time in generations. These defeats in the once Labour strongholds of the industrial working class retain a mystical hold over the party. For party members, Labour cannot be truly “Labour” without winning back what were its old industrial and mining heartlands. Yet the facts about these highly diverse seats are not what they seem. Red Wall voters are often characterised as “left behind” or the “losers from globalisation.” True, the old industries that were the economic backbone of these communities, such as mining, textiles and basic manufacturing have gone. Yet, statistically these are not the most deprived parts of Britain which tend to be found in London, the big cities, and badly neglected, declining seaside towns. Levels of owner occupation in the Red Wall for instance tend to be high. Red Wall seats are also diverse in themselves. For example, some mining districts of half a century ago are in attractive countryside that have become home to suburban commuters with jobs in the cities, while the cities themselves are in turn home to large student and ethnic minority populations. Some ‘Red Wall’ seats contain areas of great deprivation but are also home to good, well-paid jobs such as in the defence and nuclear industries in my native Cumbria in what are now the Conservative held seats in Barrow, Copeland, and Workington.
‘Red Wall’ constituencies do tend though to a greater preponderance of older voters and pensioners, often lacking further or higher educational qualifications and are disproportionately Brexit supporting. Also, throughout the years of austerity since 2010, their older electorates benefited from the fact that social benefits for pensioners have been protected, while those for young families have been held back in real terms. ‘Red Wall’ voters do feel a sense of psychological loss. The once predominant world of tough male manual jobs that characterised their communities engendered feelings of social value, pride and solidarity which have disappeared alongside the strong trade unions that once thrived with them. Children who do well at school go off to college and often don’t come back. Nostalgia for a better past is symbolised by the much-lamented decline of local shopping centres.
The policy challenge in the Red Wall is to replace lost industries with new jobs and new sources of economic strength. The New Labour governments of 1997-2010 tried hard to achieve this, with Regional Development Agencies their chosen instrument. But this effort was perhaps not hard enough. Labour had considerable success in reviving the northern cities such as Liverpool, Manchester, Leeds, Sheffield and Newcastle as great service, educational, cultural, and sporting centres. Regeneration was less successful in the smaller towns. Labour has paid a political price for this. Policy was too dependent on new public sector jobs that disappeared with austerity, while the extraordinarily difficult challenge is to foster new clusters of enterprise in old industrial towns and mining districts. The RDAs however had big ideas and developed a capacity to make change happen. It was a tragedy that in 2010, the Coalition decided to abolish them, which the Liberal Democrats shamefully failed to stop.
Johnson chose levelling up as his principal post Brexit mission. But he never satisfactorily defined what he meant, nor how satisfactorily to make change happen. The Johnson government poured levelling up money into town centre revival in response to Red Wall grievances. The long-term impact on economic regeneration will in all likelihood be marginal, although it will give the 2019 generation of Conservative MPs something to boast about. Nostalgia for a past that will not return is a poor basis for a viable political project. Shopping has been revolutionised by the internet and that will not change. Town centres need to be reimagined and repurposed – as homes for the elderly and single, as locations for specialist retailers, as affordable workshops for business start-ups and as places of creativity and culture. Business rates reform is crucial as Rachel Reeves has promised. A high priority for social democrats might also be to ensure that the new generation of delivery drivers and warehouse workers enjoy decent terms and conditions of work, and that shopping online is made more accessible for the elderly and vulnerable. There is no future in attempting to recreate most declining shopping centres as they once were. Labour has always won elections when it has been seen as a ‘party of the future.’
It is also an electoral reality that winning back the Red Wall is necessary, but not sufficient for a Labour victory. The collapse of public faith in Boris Johnson, together with growing disappointment at the practical results of Brexit, has done much of Labour’s work for it in these seats. Labour’s electoral strategy needs to be broader and more inclusive. Fundamentally this means gaining seats in the new town, suburban, and settled urban communities of southern England. There has never been a Labour government when Labour has not won a string of North Kent constituencies along the Thames estuary – in places like Dartford, Gravesend, Faversham down to Dover. Similarly, Labour has always depended for government on picking up seats in Hertfordshire to the north of London in towns like Watford, Hemel Hempstead, Stevenage, and Welwyn. Yet in this type of seat the Conservatives have built up huge majorities since Labour lost office in 2010. Indeed, Labour’s target list now includes constituencies that have never been won by Labour in the past, such as once fashionable seaside resorts such as Bournemouth and Worthing.
In the Labour campaign there are welcome signs of a shift of emphasis. The recent report from the Labour pressure group, Labour Together, has correctly identified that Labour’s focus should be on winning over ‘Stevenage woman,’ not the ‘Workington man’ – the target voter for the Conservatives who in 2019 symbolised the Johnson effort to destroy Labour’s position in its heartlands. In truth I find these stereotypical explanations of target voters, and the fascination of many electoral studies with different ways of dividing up the electorate into segments, as unhelpful and a gross over-simplification. True in 1997 there was much chatter about winning over ‘Mondeo man’ and ‘Worcester woman’ but I am not convinced Tony Blair paid that much attention to it. He saw his task as building a broad coalition – a ‘big tent’ – regardless of class, gender, and region – based on shared values and interests.
Yet in understanding the concerns of ‘Stevenage woman’ Labour strategists could do a lot worse than reread Giles Radice’s brilliant analysis of Southern Discomfort that he produced for the Fabian Society after 1992 election. Then, the public strongly supported Labour’s ambitions for decent public services and for greater fairness. The issue for Labour was one of lack of trust to deliver these shared goals, particularly on questions of the economy, tax, and the unions. Not much has changed in my view.
And then of course there is Scotland, culturally something of a special case but hugely important to British Labour. Previous Labour Leaders could rely on a solid Scottish phalanx of forty or so Scottish Labour MPs: today there is one. As a result of Nicola Sturgeon’s sudden and unexpected resignation as Scotland’s First Minister in February 2023, the bitter leadership election for her successor and the arrest of Peter Murrell, Sturgeon’s husband thought to concern allegations of mishandling of the SNP’s finances, cracks in the SNP’s hold over Scotland are opening up. A forthcoming byelection in the Glasgow suburb of Rutherglen may prove sufficient to break the nationalist mould. The prospect that Labour might gain fifteen or twenty seats from the SNP in Scotland, possibly more, could be decisive in securing a working majority for Labour.
It is not much remarked upon, but it is nonetheless true that a narrow Commons majority for Labour would award significant leverage to the thirty or so members of the Socialist Campaign Group who remain Labour MPs. The Tories may well seek to exploit this legitimate fear, as they did in 2015 when the Tories argued to great effect that an Ed Miliband government would be in the pockets of the SNP. In recent Westminster elections, the SNP could credibly argue that a vote for them was the best way of standing up for Scotland against the dominance of the Conservatives in London. Now Labour can argue in Scotland that Labour has a credible chance of removing the Tories from power in London altogether. The greater that seems a real prospect, the more Labour can rid itself of the charge that it will still be dependent on Corbynite votes.
Constructing a winning coalition however is not just about demographics. Political scientists point to cultural divisions replacing class as the dominant factor in determining voter choice. Of course, if class had historically been the main determining factor in voting behaviour, Labour should have won every general election since the introduction of universal suffrage (for men in 1918)! Millions of working-class people have always voted Tory. Labour’s problem has been the decline in the size and class consciousness of the organised working class because of the disappearance of the most heavily unionised sectors of the economy. For decades Labour has struggled to come to terms with the collapse of old time Labourism.
People point to Brexit as an example of how a cultural preference for sovereignty and independence led millions of working people to vote against what experts argued objectively on all the evidence available, was against their economic self-interest. Brexit did prove a trigger for detaching a significant segment of white working-class voters away from Labour. Why was the referendum lost? As a passionate pro-European, the vote for Brexit came as no surprise. Support for Britain’s EU membership was always fragile. By 2015, it hung by a thread. In Britain, Europe was always an elite project without a united elite behind it: one of the paradoxical consequences of the 2016 referendum was to create a mass pro-European constituency in the country that the EU had never enjoyed before. Both Labour and Conservative governments had rarely made a strong pro-European case. The core of the Brexit identity argument – that Britain was at its strongest when it stood alone (as against Hitler in 1940) was never directly challenged; the argument for pooling sovereignty as the answer to the problems of growing interdependence rarely made.
The referendum came at a point of especial vulnerability for the European cause. The Euro crisis had undermined the argument that Europe represented the hope of a brighter economic future: the British elite have steadfastly refused to acknowledge why the Euro did not break up under pressure as so many predicted and the scale and significance of the governance reforms the EU has since made. The refugee crisis of 2015/16 heightened the toxic profile of immigration as the key factor in the Brexit vote. Of course, there was a broader element of alienation from the governing class that contributed as well. In the 1975 referendum, the overwhelming support of business for ‘Yes to Europe’ was thought to have been a key factor in persuading working people that Europe was where their best interests lay: by 2016, public respect for the views of business was in sharp decline. Britain was living through an age of austerity following the banking crisis of 2008, for which Labour had been successfully pilloried while the bankers of course continued to enjoy fat bonuses. Corbyn in 2016 had none of the appeal to traditional Labour voters that Harold Wilson still enjoyed in 1975.
After 2019, Brexit for understandable reasons became the great unmentionable in Labour’s dialogue with the voters. Keir Starmer persuaded most Labour MPs to back the Trade and Cooperation Agreement (TCA) in December 2020 on the basis that the alternative was the disaster of ‘no deal’. As a committed European who has spent much of my political life campaigning for Britain to be at the heart of Europe, I found this episode excruciatingly difficult. But Keir Starmer was right. Labour could not keep campaigning against a Brexit that was a fact of life. There was, and still is, no public appetite to reopen the most divisive debate in Britain’s post war history. That is why Keir Starmer and Rachel Reeves took the decision that not only was “re-join” off the agenda, but that Labour would also reject the halfway houses of the Customs Union and Single Market. These decisions will not change before the next general election, but among the electorate there are however growing signs of Brexit regret. A clear majority now thinks Brexit was a mistake, including many Leave voters for whom the extravagantly promised benefits have been scarcely visible. This gives Labour the political space to become more vocal in its criticism of Johnson’s “botched Brexit deal,” as public opinion becomes ever more sceptical of whether Brexit has been worth all the hassle it has caused.
The first opportunity to seek major change will come immediately after the election in the planned review of the TCA. Labour has put forward a sensible agenda for the changes it will seek in general terms. The question will be whether any feasible adjustments to the TCA will provide enough stimulus to growth and business investment given the dire economic consequences of Brexit, which become more evident every day, and the compelling necessity of constructing a new growth agenda for Britain. Radical changes in Britain’s terms of trade with the EU will be difficult to secure if the European Commission sticks to the doctrine that “third countries” cannot pick and choose which parts of the single market they wish to sign up for. The Commission and Europe’s political leaders will have to be forcefully persuaded that Britain cannot be treated as in the same category as Mexico or Brazil! In or out of the EU, we are a leading European country that shares the same challenges that the rest of Europe and the EU face.
The trump card Labour has in its hands- as opposed to the Conservatives, a strong section of whom are deep-seated opponents of any closer relationship with the European Union – is that Labour can be active and committed pro-Europeans from where we currently are – outside the formal structures of the European Union. Under Labour, Britain will be a committed partner, ally, and friend of the European Union in all the challenges we as Europeans collectively face. The need for a comprehensive foreign policy, security, and defence procurement relationship with the EU in facing the together the challenge Russia poses to our security, which Ukraine makes compelling, is self-evident. An obvious area for close cooperation is economic sanctions but there are many other potential spheres of common action where Britain has much to offer.
Take for example our common commitment to climate transition. The expansion of British renewable production assumes something like a tenfold increase in wind capacity in the North Sea. This requires close cooperation, even a common plan, with continental partners who share a north common seaboard. This is fundamental to exploiting the full potential of North Sea wind power. The key is interconnection across the seaways and a common electricity trading system between Britain on the one hand and France, Belgium, the Netherlands, and Denmark on the other.
Similarly, it would be difficult and counter to our national interests to set ourselves apart from the EU plan to introduces a ‘carbon border adjustment mechanism’ (CBAMs) – in effect a tariff on the imported content of goods from outside the EU where effective measures to reduce carbon emissions are judged not to be in place. Were Britain in practice to diverge from EU carbon policies, Britain would face a deluge of imports from countries which do not match EU standards and requirements. UK exports to the EU would then consequently be subject to tariffs that would nullify any false competitive advantage so obtained.
The facts of life demand that nations in the West work together to protect their vital economic and security interests. The United States and the European Union have set up a Trade and Technology Council to establish common positions on these issues. The agenda is wide-ranging for example the regulation of artificial intelligence and other emerging technologies; improved resilience of supply chains where Europe and America are dependent on vulnerable imports such as in the case of microchips and rare earths; and controls on supply and export of security sensitive technologies and materials, especially involving Chinese businesses. A recent meeting of this Trade and Technology Council was help in Sweden under their EU Presidency with the US Secretary of State, Tony Blinken. And where is Britain? Peering through the window from outside. This must be a priority for change.
Closer economic ties are a logical consequence of the multi-faceted political challenges that Britain and the rest of Europe must by reasons of geography and shared political values face together. There must be a determination across the whole of government to rebuild trust in our relations with the European Union and its member states. Lack of trust has become a barrier to practical cooperation in pursuit of progress across multiple fields of endeavour. Europe cannot be ignored.
Behind Labour’s caution on Europe lies a fear that Brexit has ushered in a new era of cultural politics. In my view, there are dangers for Labour here in over interpreting this trend. Comparisons with Trump are especially misleading. Johnson is not Trump, but now he is gone, no one can play the tunes of social nationalism as well as he once did. Most British voters, whether they supported Brexit or not, are not fired up by establishment conspiracies, religious fanaticism, or extreme social conservatism. The national unity shown throughout the Covid epidemic in supporting unprecedented restrictions on personal freedom, or the unity of grief at Queen Elizabeth’s death do not suggest a country permanently at war with itself. Polling suggests that by far the most important issues for voters across the country are the cost of living and the state of public services, especially the NHS.
The Conservatives clearly believe they can bolster their core support by playing to an agenda of social conservatism. They are attempting to portray Labour as in the pockets of ‘woke’ activists on issues like asylum, gender recognition, sex education in schools, or a refusal to acknowledge the alleged role of men of Pakistani heritage in child abuse gangs, despite the evidence that overwhelmingly white men commit this type of crime. Labour must not fall into the ‘woke’ trap. Rishi Sunak clearly sees commitments to get tough on criminals and ‘stop the boats’ of illegal asylum seekers as policy areas where political advantage lies. That is why it is legitimate for Labour to highlight in stark terms that can shock how the Conservatives under Rishi Sunak bear responsibility for a broken criminal justice system and a dysfunctional asylum and refugee policy.
I see little evidence that social conservatism and dog whistles that border on being racist will work for the Conservatives at a time when concerns about living standards and public services are so high. While Labour must avoid self-inflicted own goals, it is not self-evidently in the Conservatives self-interest to drift into sounding like the “nasty party” as Theresa May warned them twenty years ago. Labour should be more confident that its core values of fairness, social justice, tolerance, and respect for the rule of law are in touch with the values of the British people.
On policy in general, Starmer has moved the party onto the centre ground. A substantial section of the 2019 Labour party would have been content with a policy stance that amounted to ‘Corbynism without Corbyn’. In his leadership campaign, Starmer gave part credence to this dream by including ten left wing sounding policy pledges in his personal manifesto. This proved an unnecessary mistake, which will give some substance to the inevitable Conservative charges of ‘flip-flopping.’
Of course, the same could be said of the manifesto on which Rishi Sunak lost his leadership election to Liz Truss, on which he clearly feels vulnerable. A good example of the Sunak flip flop is his decision to significantly water down his leadership election promise to consign all EU derived law to the political shredder by the end of 2023. Such a pledge was grossly irresponsible in its own terms and the proposed absence of full parliamentary scrutiny of key legislative changes an affront to the sovereignty of parliament that Brexiters so loudly proclaimed. And there is scant real evidence that such mindless acts of deregulation can improve UK growth potential.
Defenders of Keir Starmer should point out that, to win the post Corbyn leadership election in the Labour party as it was in 2019, it was necessary to reflect the policy positions which party activists had come to accept as normal under the previous incumbent. Social democrats like me should not be high and mighty about this. We should recognise that no candidate of ours would have been able to wrest the party from the Corbynista grip unless they had served in Corbyn’s Shadow Cabinet.
Since 2019, events have completely changed the policy agenda Labour has to address:
Labour has been sensibly cautious about the specific commitments it has made, especially to additional public spending. Specific pledges have been costed and the party has gone to considerable lengths to demonstrate how they will be paid for. This is how the game of opposition politics is now played. However, caution is not simple a matter of political prudence: it reflects the despairing realities of the British economic situation. The 2019 manifesto is about as relevant to these challenges as the Book of Genesis to modern religious faith.
In her May 2023 speech in the United States, Shadow Chancellor began to address Britain’s fundamental economic problem. The “secureconomy” she set as her goal is unachievable without a radical growth plan. Growth is fundamental whatever some ideological Greens say.
The failure to grow the economy – the fact that since Covid in the G20 no country other than Russia has suffered a worse economic performance – ensures that the post-election picture for the public finances will be truly dire. For the three post-election years of 2024-27 the present government is assuming a fiscal tightening in which the growth in current public spending will be held back to 1% per annum in real terms. As a result, the OBR forecasts that public spending by departments (excluding social security, debt interest etc) will fall from 16.4% of GDP in 2023/4 to 15.6% by 2027/28). This amounts to an agenda of hidden public spending cuts to which the Conservatives are not owning up.
There is a long list of spending pressures of which the government has taken little account in its published spending plans. In this March’s budget. the Conservatives themselves have made new unfunded pledges to increase spending on childcare (the OBR estimates at an extra cost of £5.2billion a year by 2027/28) and defence (where the additional promised sums look too low) for which no future provision has been made. And there is much else for which extra money will have to be found, for example:
The Conservatives have one simple target in mind: to cut the UK tax burden which, according to the OBR, is set to rise from 33.0% of GDP in 2019/20 to 37.7% in 2027/28, up 4.7% since the 2019 general election. The Conservatives are now signalling – forget growth enhancing public investment, forget social care, forget the children from deprived backgrounds who’ve fallen behind at school because of Covid; forget the widespread chaos across Britain’s public services; forget the need to restore the 0.7% aid target, at a time when apparently a third of the current reduced aid budget is being spent within Britain on meeting the costs of housing refugees and asylum seekers; forget the compelling need for rearmament in Europe; the Conservative party top priority is to find money for tax cuts as their last throw of the political dice.
Labour must not be intimidated by this prospect. It is a matter for careful political judgement how Labour should respond to Tory promises of tax cuts. Labour should argue that the nation cannot afford unfunded giveaways given the desperate position the country finds itself after thirteen years of Tory stagnation. It is fundamentally their failure of policy on economic growth which must change.
My instinct would be to support some tax relief for the lower paid, funded by closing some of the tax reliefs that top taxpayers enjoy on capital gains, dividends, and pensions. But I would make the argument that any more general reduction in taxation would be dependent on a return to robust economic growth. And Labour should set out a clear path as to how to achieve this.
Prudent public investment in assets that produce higher returns than the costs of borrowing to pay for it, should not be seen as immediate costs that must be funded by either taxes or public borrowing. Supply side investment that genuinely improves the nation’s long term growth potential should always be allowed to go ahead: with one important caveat that the financial markets regard the government’s general position on borrowing as sustainable. In the case of the UK this can be problematic because of our long-standing balance of payments deficit: we are as a country, as Mark Carney famously said, “dependent on the kindness of strangers” to buy our public debt. Similarly in the case of public services, ring fenced spending increases that lead to lower public service costs in the longer term make economic sense. But investments must prudent and in the case of public services, the savings because of reforms must be genuine. Financial market credibility and prudent tax, spending and investment plans are two sides of the same coin. Where Liz Truss and Kwasi Kwarteng got in wrong, Keir Starmer and Rachel Reeves must get it right.
For ‘invest to grow’, Labour has already committed itself to a significant programme of investment in climate transition. At a pledged £28bn a year that represents an annual investment of something between one and one and a quarter percent of annual GDP, almost double the annual spend on the Home Office budget. The hope is that this would help create in Britain a new generation of industries at the forefront of the clean energy sector. Also, the climate revolution has the potential to create a new generation of tens of thousands of highly skilled, decently paid jobs in every part of the United Kingdom as we meet the challenge of home insulation, phasing out gas boilers and exploiting the new potential of hydrogen fuels and heat pumps. At present this is more of an aspiration than a costed programme. But the policy faces serious problems, political, and practical.
The political problem was bought home to me by meetings with an Australian Labour delegation at last year’s party conference. The slogan emblazoned across our conference platform was Labour’s mission to create a “fairer, greener future”. The ALP delegation argued that, while the emphasis on climate change was correct in policy terms (and they had just won a famous election victory against Australian Liberal climate deniers), the Australian electorate did not make the link between on the one hand, tackling climate change and on the other, higher growth and improved living standards. Australian voters saw climate policy as a cost, not a growth opportunity and they did not understand the link to better jobs. The ALP visitors felt UK Labour had much to do to explain their policy, particularly as the economic challenge Britain faces is so much deeper than Australia’s. Ed Miliband has made powerful arguments that investments in green power, such as windfarms, will bring down electricity costs and thereby in the medium-term support living standards. He has made the case that green investment can transform the competitive position of the British steel industry (though the consequence would inevitably be far fewer jobs in steelmaking). But we are still in my opinion some way short of convincing voters that our green policy thrust is fundamentally about growth and jobs.
Also, the need for a more active state pursuing a growth agenda through public private partnership across the board is bigger than the challenge of net zero, though climate will remain a key part of it. The promotion of new industrial strengths has equally to be a priority for Labour, particularly in sectors where Britain already has considerable strengths. Labour needs a credible industrial strategy that embraces all the new industries of the future including areas such as biomedicine, artificial intelligence, and new material technologies as well as carbon capture and batteries. The absence of such a strategy is a massive political vulnerability for the Conservatives. They have failed over thirteen years to develop a modern industrial policy for Britain with any consistency, except for Greg Clark’s tenure as Business Secretary. Britain’s inability to match Europe and America in areas such as electric battery production and microchips is becoming painfully evident. Sunak needs to be exposed as a ‘laissez faire’ free marketeer without an adequate plan for Britain’s industrial renaissance.
But at the same time as criticising Tory failure, Labour needs to focus on how it would manage a large-scale programme of climate investment and industrial renaissance successfully. Public subsidy and public investment will have an important role to play in kick-starting ‘green’ investments and supporting the growth of new ‘green’ consumer markets, as is planned in the United States Inflation Reduction Act and the EU plans for incentivising climate transition. Similarly, subsidies and public investment will be necessary in the UK to support the creation of new British jobs and new British based businesses across a whole range of industries of the future.
Yet Labour must recognise the limits of the possible. Britain does not have an infinite capacity to borrow. The reality is that Britain is competing in a European and global market where Britain lacks critical scale and at present is woefully short of the necessary industrial capacities. Inappropriate protectionist rhetoric that all our ambitions for climate transition can be achieved by supporting ‘British firms’ and ‘British jobs’ should be avoided. It is the opposite of what business, whose thinking remains international and global, believes. In practice a pro-European Labour government should seek the closest possible alignment with Europe’s developing plans. It would not make commercial sense for Britain for example, to invest in all aspects of climate transition given that companies in other countries have already established a substantial first mover advantage over any UK start-up. Public investment should be conditional on demonstrating how a new British based company can achieve the critical mass to become a successful exporter: the scandalous failure of Britishvolt should be a lesson to us all.
At Labour’s autumn 2022 party conference, Labour pledged to establish a new publicly owned Great British Energy. (As one would expect, this was received with huge enthusiasm in a hall packed with Labour activists.) In the right circumstances, a new body with the capacity to invest public money on the taxpayer’s behalf could be extremely useful in mitigating private sector risk. However private sector companies may be nervous about entering into government partnerships in these new markets until the role of Great British Energy is better defined. Keir Starmer does not see GBE as a vehicle for nationalisation: that is progress. Similarly, Labour needs to flesh out its ideas for establishing a British sovereign wealth fund.
Keir Starmer has been right to emphasise that partnership with business will be one of the driving themes of his government. Partnership with business must be a key principle of Labour’s way of working. The free market left to its own devices will not provide the new industrial capacity we need, but nor will an all directing state. Some sectors need more of an element of planning than others, such as the need for a coherent plan for the development of the National Grid, with inter-connectors to our Continental partners. The speed of take up for electric cars depends on a plan for reliable and widely available charging points.
An incoming Labour government will need to draw on the best industrial and commercial advice available: the expertise of private equity should play a significant role. Mechanisms and advisory machinery with real teeth must be established so that advice on potential projects can be presented to ministers, fearlessly and regardless of inevitable political logrolling. Labour must make a success of industrial policy by showing how all projects will be subject to objective analysis and maximise the value of public investment. Much of this programme will need to be financed by additional public borrowing. Labour’s plans must therefore carry the confidence of the financial markets.
For “invest to save” the litmus test is whether upfront additional ring-fenced spending on public services will make their provision cheaper in the medium term and reduce pressures for future spending. The best example is social care where an effectively functioning system would both help keep the elderly and frail out of hospitals and prevent long delays to their release once they are there: this would potentially open up huge strides forward in NHS efficiency. Other examples of upfront spending to save money in the medium term might include more effective practical help for troubled families which would the reduce the need for numbers of children to be taken into care. The recent government commissioned review by Josh Macalister demonstrated how an upfront investment of £2.8 billion over four years could reduce the spiralling long-term costs of institutional care at the same time as leading to happier outcomes for children at risk.
Invest to save is also a justification for comprehensive support for better early years provision in overcoming educational disadvantage. Yet another area would be radical reform of our system of further education colleges and post92 universities to raise the quality of provision, reduce the costs of existing degrees that do little to enhance student employability, and create a genuine ladder of opportunity from decent apprenticeship to high quality vocational degree up which students can climb module by module at the institution that best serves their needs and ambitions. “Invest to save” might equally apply across all areas of public service reform, particularly the police, the criminal justice system, and coping with problems of rough sleeping, drug abuse and alcoholism.
In devising Labour’s prospectus for the election, ending the calamity of a decade and a half of economic stagnation and broken public services must be at the centre of the Labour programme. A modern industry policy, well planned public investment and comprehensive public service reform must be at its heart. This will require big changes in the way government works.
Government at all levels – national, city region and local – needs to be open to new talent. Starmer’s Britain needs to draw in the best ideas, the best thinkers, and the best doers, pioneers in the charitable and voluntary, third sector; innovative and successful managers of public services; those from the private sector who combine strong social commitment with a genuinely entrepreneurial mindset. This task should be a priority for the new generation of Labour ministers, and there needs to be a high-level task force in advance to the general election to work out how this can be done. This is not anti-civil service as too many Conservative ministers presently are. Rather, we need to raise the morale of public service if Labour is to achieve substantial change. And this needs an injection of new talent to work alongside the best of the civil service who have been denigrated and bullied for far too long.
Decision making needs to be devolved to the maximum possible extent. Effective partnership with business requires formal structures at national, sectoral and city region level. The challenge is to achieve this in the least bureaucratic but effective way. Big investments should rightly remain matters for decision at UK level. But for the rest, the centralising and stifling grip of government departments and the Treasury needs to be released. For fifty years governments have talked about devolution. The Brown Commission has set out a set of radical proposals. Labour has promised that one of its first measures will be a ‘Take Back Control’ Bill. But these are commitments of high generality. If there is to be Action This Day (as Churchill wrote on his wartime memos), the details must be worked up now and involve an open process of deliberation.
The Labour Leader has been subject to some mockery for his various attempts to define Starmerism from the “under new management” of the summer of 2020 to the “work, care, equality, security” of 2021 conference to the “security, prosperity, respect” of New Year 2022, the “fairer, greener future” of the 2022 conference and the “build a better Britain” speech of this spring. In truth, these criticisms of slogans and soundbites are trivial. The five missions for his government that Starmer set out in March are all perfectly serious:
These missions will give a medium-term focus to his government in contrast to the inconsistency and comprehensive policy failure of the announcement-driven “sticking plaster politics” of Conservative rule. What Keir Starmer now needs to do is give the electorate more of a feeling of what in Britain he is passionate to change. And he needs to explain to the sceptics what it is about him that makes him different to the Conservatives. In other words, he must answer the question what kind of social democrat am I?
In terms of both strategy and communications, there is still something lacking. Let me illustrate with a bit of history. Every time Labour has won an election in Britain it has done it on the back of recognisable governing principles.
I am no marketing professional. But I suggest this as workable brief for what a Starmer government would be about.
The Starmer government will end thirteen years of Conservative economic stagnation, public service neglect and political chaos. It will be a breakout government with a consistent and coherent plan for investment in the restoration and renewal of what makes us feel proud about Britain.
This new investment will be costed, affordable and in full keeping with the missions we have set out.
Labour will invest to grow the economy from the bottom up in all parts of Britain, to secure Britain’s place in the industries of the future and to meet our transformative climate and energy goals.
Labour will invest to save in public services and reduce the costs of societal failure by upgrading social care, reforming our NHS to avoid preventable illness, supporting young families, extending opportunity for education and skills at all levels and cutting the costs of crime.
We will end top-down government, work in close partnership with business and devolve power and responsibility to our nations, regions, and communities to the maximum extent.
Starmer’s Labour party is work in progress, but necessary work if Labour is to fight a convincing general election campaign and succeed in government. No one expects overnight miracles. But Labour must have ambition and demonstrate a coherent long-term strategy to be the kind of social democratic government that inch by inch tackles the hard boards of injustice in our society.
The Blair government in many ways had it lucky. It came to office in 1997 on a rising economic tide that created the underlying conditions for Labour to win two successive elections. It was not just improved public services that voters liked about the Blair governments, nor the massive help for the poor elderly and children living in poverty that the Brown Treasury delivered: the average living standards of working families rose constantly through this period.
That is why Starmer Labour must achieve “break out” from Britain’s present stagnation. That is the only way to ensure it can be more than a one term government.
Roger Liddle
Roger Liddle is a Labour member of the House of Lords and a member of its European Affairs Select Committee. From 1997-2004 he was European special adviser in Tony Blair’s Policy Unit in 10 Downing St. He then worked in Brussels, first in Peter Mandelson’s cabinet when he was Trade Commissioner, and then for President of the Commission, Jose Manuel Barroso. He then became a key adviser to Peter Mandelson as Business Secretary. From 1976-9 he was a special adviser in the Callaghan government for Bill Rodgers as Transport Secretary. From 2013-23 he was a Labour member of Cumbria County Council. He is currently a director of Progressive Britain.
